The Canadian economy will grow at a moderate pace in the coming quarters and 2011 will end with just 2.3 per cent real GDP growth, the report said.

With that mild growth, the Bank of Canada won’t return to key interest rate increases until July, it forecast.

Ontario

The province’s housing market slowdown, the auto industry’s recent peak, and the strong loonie will hamper growth and GDP will rise just 2.2 per cent.

Quebec

Quebec’s employment market saw a rapid recovery, but declining investment in public infrastructures, controlled government spending and the higher household tax burdens will curb growth. Real GDP will rise 2.3 per cent in 2011.

Atlantic – 2.1 %

Manitoba – 2.5 %

Saskatchewan – 2.7 %

Alberta – 3 %

B.C. – 2.4 %

Waiting on the US

South of the border, there are signs of improvement but the job market’s is timid, curbing consumer enthusiasm in the next few quarters.

After gaining 2.8 per cent in 2010, US real GDP should advance 2.4 per cent in 2011 and 2.8 per cent in 2012.

Rising costs for most raw materials will keep the Canadian dollar entrenched above parity against the greenback in 2011, the report added.

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